The governor of the Bank of England has sent the pound higher on the foreign exchanges after he warned that the continued growth in the UK economy would eventually lead to higher interest rates. Sterling rose by almost a cent against the dollar to stand at a post-election high on remarks seen as bringing forward the date of the first increase in the cost of borrowing since the start of the financial crisis 10 years ago.

Although Carney broadly reiterated his “wait and see” approach to interest rates, the pound was trading at just below $1.30 amid speculation that the Bank’s monetary policy committee would over the coming rescind the emergency quarter-point cut in interest rates after last summer’s Brexit vote.

The governor stressed that certain conditions needed to be met before he would side with MPC members pressing for higher rates, and hinted that he would not change his vote at their next meeting in August.

“When the MPC last met earlier this month, my view was that given the mixed signals on consumer spending and business investment, it was too early to judge with confidence how large and persistent the slowdown in growth would prove,” Carney said at a gathering of central bankers in Portugal. “Moreover, with domestic inflationary pressures, particularly wages and unit labour costs, still subdued, it was appropriate to leave the policy stance unchanged at that time.

“Some removal of monetary stimulus is likely to become necessary if the trade-off facing the MPC continues to lessen and the policy decision accordingly becomes more conventional. The extent to which the trade-off moves in that direction will depend on the extent to which weaker consumption growth is offset by other components of demand, including business investment, whether wages and unit labour costs begin to firm, and more generally, how the economy reacts to both tighter financial conditions and the reality of Brexit negotiations. These are some of the issues that the MPC will debate in the coming months.”

Carney’s cautious approach to raising interest rates was supported earlier by one of the Bank’s deputy governors in an interview on BBC Radio 4’s Today programme. Sir Jon Cunliffe said consumer spending was slowing as households’ real incomes were squeezed by higher inflation. “We expect some of that slowing to be offset by growth in business investment, growth in exports. And I want to see how that plays out.

“[We] do have to look at what’s happening to domestic inflation pressure, and I think that, on the data we have at the moment, [it)] gives us a bit of time to see how this evolves.”

The remarks by Carney and Cunliffe contrast with the more hawkish comments by the Bank’s chief economist, Andy Haldane, and suggest that battle lines are being drawn before the August MPC meeting. The committee voted 5-3 in favour of leaving rates on hold at 0.25% at its most recent meeting, but the City was taken aback when Haldane said he had been close to abandoning his no-change stance.

Bank of England deputy opposes rate hike, as UK house prices rebound - business live

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Inflation as measured by the consumer prices index is 2.9% and expected to rise further above the government’s 2% target over the coming months.

The three MPC members who voted for a rate rise believe the lowest unemployment rate since the 1970s will generate pressure for higher wages and that, unless policy is tightened now, there is the risk that a more aggressive stance will have to be announced later. One of the three – Kristin Forbes – is no longer an MPC member and has been replaced by Silvana Tenreyro, whose views on the necessity of a rate rise are unknown.

With Haldane indicating that he might join Ian McCafferty and Michael Saunders in voting for higher borrowing costs, and Cunliffe siding with Carney, the result will be decided by deputy governor, Ben Broadbent, Jan Vlieghe, the former hedge fund economist, and Tenreyo.

The MPC normally has nine members but is down to eight as a result of the resignation of Charlotte Hogg for failing to declare that her brother worked at Barclays. In the event of a 4-4 tie, Carney would have the casting vote.